High-performance work practices could improve employee productivity, but there are potential negative effects to deal with.
High-performance work practices (HPWP) is the term used to refer to HR management practices associated with employee engagement, performance management, work organisation, skills development and learning. Increases in performance do not necessarily come from a single HR practice, but from the synergies of an architecture on performance management that values, motivates and rewards effort.
HPWP has attracted considerable interest in recent years because of its potential impact on an organisation’s performance, but the link is contentious. There is evidence that HPWP can help to improve performance, but gains may be achieved through intensification of work, such as increased workload or pressure, which can have a detrimental eff ect on employees. So, can HPWP boost performance without negative effects for staff?
Recent case research suggests it is possible to achieve a win-win scenario for employers and employees, but this depends on how HPWP is implemented. Certain key steps are needed to achieve a positive outcome for all parties.
First, employees need to see a tangible payback for their initial eff orts before they are likely to offer more commitment. So, changes in working arrangements that yield higher performance for the organisation should be reinforced by changes in pay and reward or improvements in working conditions. If an employee fails to see any benefit from their extra eff orts, further performance improvements will probably stall.
Second, it is vital to secure senior management support for implementing HPWP because this signals the legitimacy of the changes to employees.
Employers should also bear in mind that staff are constantly bombarded by change initiatives, which can desensitise them to the strategic importance or value of any programme. So, if employees are to feel motivated to change their behaviours, they need clear signals from senior management that change is desirable, necessary and will yield reward for employees, not just the employer.
Managers should not assume that HPWP produces universally positive effects. Increases in workload and more pressure on staff are often reported as characteristics of a move towards HPWP. However, these negative eff ects can be off set by changes in how work is organised, changes in reward management, and training opportunities.
Constructive dialogue between employers and employees provides the communication channels to monitor and sustain change and performance gains. Issue-based employer-employee groups have been used successfully to support HPWP implementation. Building strong trust between employer and employees is critical.
A final point to consider is which performance metrics to use to assess the impact of HPWP. Financial performance is often taken as the key indicator, but this depends on factors other than employee effort, such as marketing, accounting procedures and the economic environment. For this reason, the evidence supporting the link between HPWP and corporate performance can be ambiguous.
To address this problem, researchers have looked at the predictive and explanatory power of other intervening performance factors and found good evidence of their reliability. These may include hard measures, such as productivity or safety, or soft measures, such as employee motivation or job satisfaction. For line managers, HR professionals and project leaders, these indicators are likely to yield the best information on performance change.
So, HPWP has the potential to make an important contribution to an organisation’s performance. The key lies in collaborative implementation.
Olga Tregaskis is professor of international human resource management, Norwich Business School, University of East Anglia